Commercial Property Management Budget Planning Tips

Commercial Property Management Budget Planning Tips


It’s that time of year. Budgeting for a commercial property can be a complex endeavor involving many considerations and cost-saving measures to take into account and contemplate before finalizing your budget for the upcoming year.

We have put together our list of some of the top ways you can budget and save as you work on preparing for another successful year as a commercial investor and property owner.

Replacement of Tenants

When setting your budget, this is obviously a major factor to take into consideration.

Do you have any tenants who are coming up for renewal this year – and will they renew?

Some of the things you will need to think about is whether you will be increasing the rents or changing the lease terms from perhaps, say, a gross lease to triple net lease in order to recover more of your expenses.

But as you make these decisions and weigh all of the pros and cons, be sure to compare it with the cost of what it would take to re-lease the space, which will most likely include vacancy loss time, Landlord Tenant Improvement dollars, as well as leasing commissions.

Re-Bid Recurring Maintenance

Before setting your budget and putting maintenance numbers down in stone, remember it is a good idea to have your vendors re-bid recurring maintenance ever so often to ensure you continue to get the best deal.

Consider whether you are happy with all of your vendors and whether you can reduce costs without reducing the appeal of the property.

Money-Saving Conversions

Some innovative, improvement expenses turn out to be very good long-term investments for commercial property owners.

For instance, have you considered switching from standard lighting to LED, including for monument signage which can also be converted to LED to save big on electric bills?

What about submetering a building? 

Submetering can save you a lot of time, money, and expense in the long-term — improving tenant relations, getting rid of tasks such as time spent debating with tenants and pro-rating and even passing off the complete management of the task to the submetering company to bill the tenants and take care of that aspect altogether.

Roof Inspection

Often, one of the most costly items for commercial owners is their roof, roof maintenance and issues from not staying on top of maintenance. 

This year, be sure to get a roof inspection so you can plan accordingly to keep up with repairs needed and have a good idea of how to budget long-term for the lifetime of the roof.

Capital Improvements

Be sure to check all leases to see what kind of items can be passed through to recoup your expenses. 

Normally, these expenses – capital improvements — cannot be passed along to tenants which is why it is also one of the most important items to budget for. 

Capital Improvements may include a new roof, new lighting, new HVAC system, renovations, or even additions to the property.

Roof INspections and Capital Improvements

Final Thoughts

Property Management Companies are experts when it comes to budgeting and how to save to get owners the most return on their investment.

If you’re possibly interested in learning more about commercial property management services, consider giving M&D Real Estate a call.

M&D has all 5-Stars and is a renowned property management company based out of Rockwall, Texas and serving the Dallas-Fort Worth Metroplex. 

M&D manages a large portfolio of retail, office, industrial and flex properties. 

Our clients love our expertise, meticulous eye for the details, and having us handle all tenant relations (including leasing, through our commercial group agents). 

Clients also love that we are a local company, with a hands-on management style that treats your property as if it were our own. 

Contact us today to learn more!

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